125 88 84 50 K B C Q =900 37 100 The price of capital is $300 per unit. The price per unit of labour is $ 176 The minimum cost of producing 1,700 units of output is $ Q=2200 Q=1700 250 To produce 1,700 units of output at the least cost the firm should use units of labour. The Marginal Rate of Technical Substitution at each cost minimizing equilibrium point is If the firm decides that total cost must not exceed $37,500, the maximum amount of output it can produce is To produce 900 units of output at the least cost the firm should use units of capital.
125 88 84 50 K B C Q =900 37 100 The price of capital is $300 per unit. The price per unit of labour is $ 176 The minimum cost of producing 1,700 units of output is $ Q=2200 Q=1700 250 To produce 1,700 units of output at the least cost the firm should use units of labour. The Marginal Rate of Technical Substitution at each cost minimizing equilibrium point is If the firm decides that total cost must not exceed $37,500, the maximum amount of output it can produce is To produce 900 units of output at the least cost the firm should use units of capital.
Chapter10: Cost Functions
Section: Chapter Questions
Problem 10.12P
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